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Stock Futures Today
Dow Jones futures today (Thursday) forecast a 137-point decline as the sell-off continues in the wake of a massive slump in oil prices and investors' expectations about a potential interest rate hike by the U.S. Federal Reserve continue to fade. Domestic oil prices were hovering just north of $40 per barrel, as a global glut continues to expand and places pressure on both domestic and international producers. You can read a recap of yesterday's movement here.
This morning, weekly jobless claims registered at 277,000, which is up marginally from analyst expectations of 272,000. This was the fourth-straight week of jobless claims increases.
On Wednesday, the Dow Jones slumped after the release of minutes from the July Fed Open Market Committee meeting. The Dow finished down 162 points and the odds of the central bank increasing interest rates in September slipped after investors examined the Federal Reserve's meeting minutes. According to the minutes, members of the central bank said they have concerns about lagging inflation levels and weakness in the global economy. The Fed did say it only requires "some" additional improvement in the jobs sector in order to hike interest rates.
Meanwhile, the German parliament announced it has ratified the new bailout deal for Greece. Terms of the deal will allow European creditors to inject money into the Greek economy, despite steep concerns from Chancellor Angela Merkel and her conservative coalition.
Top News in the Stock Market Today
- The Stock Market Today: Investors will listen to a speech by San Francisco Federal Reserve President John Williams, a weekly update on jobless claims, the monthly report on existing home sales, and earnings reports from a number of technology and retail stocks.
- Oil Outlook: Oil prices continue to crater to their lowest levels since the height of the financial crisis in March 2009 on concerns about a major oversupply glut. WTI crude futures for September dropped another 0.6% to hit $40.59 per barrel. Meanwhile, Brent oil prices dipped 1.1% to $46.65 per barrel. The decline of oil prices are a huge drag on multinational giants like Exxon Mobil Corp. (NYSE: XOM) and Chevron Corp. (NYSE: CVX), down 1.4% and 1.1% in pre-market hours, respectively.
- Earnings Reports: Companies reporting earnings include Salesforce.com Inc. (NYSE: CRM), Hewlett-Packard Co. (NYSE: HPQ), Marvell Technology Group Ltd. (Nasdaq: MRVL), Intuit Inc. (Nasdaq: INTU), Gap Inc. (NYSE: GPS), and The Fresh Market Inc. (Nasdaq: TFM).
Pre-Market Movers in the Stock Market Today: DIS, VRX, LL
- Pre-Market Movers No. 1, DIS: Shares of Walt Disney Co. (NYSE: DIS) slipped more than 2% in pre-market hours after receiving a downgrade from research firm Bernstein from "outperform" to "market perform." Bernstein raised concerns about market valuations for media stocks. This comes just weeks after Disney stock cratered on raising concerns about the future of paid cable services and the trend of cable-cutting in the United States.
- Pre-Market Movers No. 2, VRX: Shares of Bill Ackman-backed Valeant Pharmaceuticals International Inc. (NYSE: VRX) were unmoved this morning after the company announced plans to purchase privately held drug firm Sprout Pharmaceuticals for $1 billion. Just this week, the U.S. Food and Drug Administration announced the approval of Spout's female libido drug, dubbed by the media as the "female Viagra."
- Pre-Market Movers No. 3, LL: Shares of Lumber Liquidators Holdings Inc. (NYSE: LL) were up more than 7% this morning after Cantor Fitzgerald upgraded the stock from a "Hold" to a "Buy." The investment firm said there is upside to the company now that it's seen its stock decline more than 80% since the beginning of the year. The firm has been caught in a controversy since a 60 Minutes report alleged the firm's flooring products from China carried a high level of carcinogens.
Stocks to Watch Today: SHLD, JPM, GS, MS
- Stocks to Watch No. 1, SHLD: Shares of Sears Holdings Corp. (Nasdaq: SHLD) were up more than 2.8% this morning after the company reported a profit in Q2, a reversal from the same period last year. The firm said it had a net quarterly income of $1.84 per share, in line with analyst expectations.
- Stocks to Watch No. 2, JPM: Shares of financial stocks were down on the day. But the big news is three of the largest financial firms in the world are planning to unite to create a data firm dedicated to determining market prices and costs associated with transactions. The Wall Street Journal reports JPMorgan Chase & Co. (NYSE: JPM), Goldman Sachs Group Inc. (NYSE: GS), and Morgan Stanley (NYSE: MS) have all invested more than $1 million to create a program called "SPReD," or Securities Product Reference Data. The platform will be launched within the next year.
Today's U.S. Economic Calendar (all times EDT)
- Jobless Claims at 8:30 a.m.
- Retail Sales at 8:30 a.m.
- Import and Export Prices at 8:30 a.m.
- Bloomberg Consumer Comfort Index at 9:45 a.m.
- Business Inventories at 10 a.m.
- EIA Natural Gas Report at 10:30 a.m.
- 3-Month Bill Announcement at 11 a.m.
- 6-Month Bill Announcement at 11 a.m.
- 52-Week Bill Announcement at 11 a.m.
- 5-Year TIPS Announcement at 11 a.m.
- 30-Year Bond Auction at 1 p.m.
- Fed Balance Sheet at 4:30 p.m.
- Money Supply at 4:30 p.m.
What Investors Must Know This Week
- Why We're Still Bullish on Apple Stock (Nasdaq: AAPL)
- The Best Way to Add Gold to Your Portfolio Today
- The 4 Real Reasons Oil Prices Are Slipping – and How to Profit
Follow us on Twitter: @moneymorning.
About the Author
Garrett Baldwin is a globally recognized research economist, financial writer, and consultant with degrees from Northwestern, Johns Hopkins, Purdue, and Indiana University. He is a seasoned financial and political risk analyst, with a focus on stocks, hedge funds, private equity, blockchain, and housing policy. He has conducted risk assessment projects for clients in 27 countries, and consulted on policy and financial operations for some of the nation's largest financial institutions, including a $1.5 trillion credit fund, a $43 billion credit and auto loan giant, as well as two of the largest Wall Street banks by assets under management.
Garrett joined Money Map Press as an economist and researcher in 2011, specializing in alternative strategies with an emphasis on fundamental and technical analysis.